HIGH COURT OF MEGHALAYA AT SHILLONG
W. Diengdoh, J.
Emilasha Laloo - Appellant
Versus
Nishan Skhem Blah - Respondent
Crl.Petn. No. 24 of 2021
Decided On : 05-04-2022
Negotiable Instruments Act - Jurisdiction - Section 138, Section 142 - The court discussed the provisions of Section 138 and Section 142 of the Negotiable Instruments Act, 1881, and their interpretations. The court highlighted the amendment to the Act in 2015, which clarified the territorial jurisdiction for trying an offence under Section 138. The court concluded that the Trial Court lacked territorial jurisdiction and set aside the proceedings.
Fact of the Case:
The respondent filed a complaint under section 138 of the Negotiable Instruments Act, 1881 for dishonour of a cheque. The petitioner approached the Court with a petition under Section 482 Cr.P.C to quash the proceedings, citing a bar of liability being legally enforceable and territorial jurisdictional issues.
Finding of the Court:
The court found that the debt being time barred was not pressed by the petitioner. The controversy centered on the jurisdiction of the court for proceedings initiated on a complaint under Section 138 of the Negotiable Instruments Act, 1881.
Issues: The issues involved the time-barred debt and the jurisdiction of the court for proceedings under Section 138 of the Negotiable Instruments Act, 1881.
Ratio Decidendi: The court's decision was based on the interpretation of Section 138 and Section 142 of the Negotiable Instruments Act, 1881, and the amendment to the Act in 2015, which clarified the territorial jurisdiction for trying an offence under Section 138.
Final Decision: The petition was allowed, and the proceedings in C.R. Case No. 1(T) of 2018 were set aside and quashed. The court advised the respondent to pursue the matter before a proper forum in accordance with the law.
JUDGMENT
1. The respondent has filed a complaint under section 138 of the Negotiable Instruments Act, 1881 before the Court of the Additional Deputy Commissioner (Judicial), Shillong for dishonour of a cheque dated 15.12.2017 to the tune of Rs. 11,30,000/- (Rupees eleven lakhs thirty thousand) only, allegedly issued by the petitioner herein to the respondent. The said cheque was drawn on the United Bank of India, Nongthymmai Branch. However, upon presentation of the same at the Meghalaya Cooperative Apex Bank, Shillong Branch by the payee, it was returned to the drawer due to insufficient fund. The said case was registered and numbered as C.R. Case No.1 (T) 2018.
2. On being endorsed, the learned Judicial Magistrate First Class, Shillong took cognizance of the complaint and vide order dated 05.03.2018, issued summons to the petitioner/accused.
3. The petitioner being aggrieved and dissatisfied with the said order dated 05.03.2018, has accordingly approached this Court with a petition under Section 482 Cr.P.C with a prayer to quash the said proceedings, inter alia, on the ground that there is a bar of the liability/debt being legally enforceable and also on the ground of territorial jurisdictional bar.
4. The respondent on receipt of notice has accordingly entered appearance and has contested the assertion of the petitioner herein.
5. Heard Mr. K.C. Gautam, learned counsel for the petitioner who has submitted that only two grounds of argument will be urged before this Court, the first being that the complaint filed by the respondent in the Court of the Additional Deputy Commissioner(Judicial), Shillong which was endorsed to one of the Magistrates, is time barred (though this issue was not pressed in these proceedings in due course) and secondly, that the ground of maintainability of the proceedings before the Trial Court is questioned as the Court which took cognizance of the said complaint lacks territorial jurisdiction, which fact was also admitted by the learned counsel for the respondent at the hearing.
6. Mr. Gautam, has submitted that the petitioner/payee is maintaining a bank account with the Meghalaya Co-Operative Apex Bank, Shillong Branch which is located in Normal Shillong (European Ward) and within the jurisdiction of the Chief Judicial Magistrate.
7. It is also submitted that the respondent as the complainant has filed the complaint case under Section 138 of the Negotiable Instruments Act before the Court of the Additional Deputy Commissioner (Judicial), whose jurisdiction covers the areas outside Normal Shillong. The petitioner as stated, is operating a bank account with the Meghalaya Co-Operative Apex Bank, Shillong Branch which is located within Normal Shillong and as such, the complaint was presented before a Court which lacks territorial jurisdiction as the Chief Judicial Magistrate exercises jurisdiction over the said area and by the said act of the petitioner in preferring the complaint before a Court lacking territorial jurisdiction, the complaint is not maintainable because of want of jurisdiction.
8. Referring to the provision of sub-Section 2 of Section 142 of the Negotiable Instruments (NI) Act, Mr. Gautam has submitted that this provision provides that only a court which has territorial jurisdiction over the area where the bank is situated, which bank the payee or holder maintains an account, can try an offence under Section 138 of the NI Act, 1881.
9. This provision was inserted by way of an amendment to the Negotiable Instruments Act vide the Amendment Act of 2015, which came into effect from 15.06.2015, primarily to ward off the difficulties created by the judgment of a three Judge Bench in the case of Dashrath Rupsingh Rathod v. State of Maharashtra & Anr: AIR 2014, SC 3519, wherein the Hon'ble Supreme Court has held that the territorial jurisdiction for dishonor of cheques is restricted to the court within whose local jurisdiction the offence was committed, which in the present context is where the cheque
Balvant N. Vishwamitra & Ors vs. Yadav Sadashiv Mule (Dead) through Lrs & Ors: (2004) 8 SCC 706
AI
The main legal point established in the judgment is the clarification of territorial jurisdiction for trying an offence under Section 138 of the Negotiable Instruments Act, 1881, as per the amendment....
Court within whose jurisdiction branch of the bank where the payee maintains the account is situated, will have jurisdiction to try offence, if the cheque is delivered for collection through an accou....
The amendments to the Negotiable Instruments Act are constitutional and do not infringe on the fundamental rights of the accused despite potential inconveniences.
Jurisdiction for dishonor of cheque cases under the Negotiable Instruments Act is determined by the location of related transactional acts, not merely where notices originate.
The retrospective nature of the provisions of Section 142A of the NI Act and the acceptance of delay in filing restoration applications.
In complaints under S.138 of the Negotiable Instruments Act, territorial jurisdiction is determined by where the cheque was drawn and presented, not merely by where notices were sent.
The main legal point established in the judgment is that the trial court had jurisdiction to try the case under Section 138 of NI Act based on the location of the complainant's bank branch, and the i....
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